The role of chromosomal proteins in maintaining the structure and regulating the function of chromatin and chromosomes is being investigated. Present efforts are concentrated on determining the cellular function of two non-histone chromosomal proteins, HMG-14 and HMG-17. These two proteins are the only known nucleoproteins whose main binding site in the nucleus is on the nucleosome. Our experiments suggest that they may be involved in modulating the structure of transcriptionally active chromatin. We have isolated and sequenced the chicken cDNA coding for chromosomal protein HMG- 14 and the entire gene coding for chicken HMG-17. The chicken HMG- 17 gene displays features characteristic of both cell-cycle regulated and housekeeping genes. We discovered a consensus structure of the transcripts coding for the HMG-14/-17 protein family. We found that the human HMG-14 and -17 multigene families are the largest known retropseudogene families. Genes coding for the functional human HMG-14 and HMG-17 have been isolated by use of oligonucleotide probes. Expression of human HMG-14 and HMG-17 in COS cells and in yeast reveals that there is a mechanism which regulates the cellular content of these proteins and that expression of the protein alters the protein profile of yeast cells. Study of the DNA binding domain of this family of proteins reveals a high degree of evolutionary conservation. These studies will advance the understanding of gene structure and function in normal and neoplastic cells and provide insights into the evolution of the nucleosome structure, a hallmark of all eukaryotic organisms.